Posted:
#1
I just stumbled on this and it's a lot of good information on the current political climate in the US and where we might be headed as far as the online gambling industry is concerned ....
https://www.cappersmall.com/betting/articles/Online-Gambling-Interview-Professor-I-Nelson-Rose-6988.html
CAPPERSMALL.COM: The passage of the Unlawful Internet Gambling Enforcement Act in October of 2006 certainly had a significant effect on how offshore wagering portals facilitate financial transactions to and from their customers. What are some of the other ways in which the Act has changed online gambling?
PROFESSOR ROSE:
There have actually been two separate legal developments. The UIGEA obviously scared the publicly traded online gaming companies to stop taking bets from the U.S. But both before and after the passage of that Act, there has been a war of intimidation being waged by the U.S. Department of Justice against all internet gambling. It was the DOJ, not the Act, that scared credit card companies into blocking use of their cards for gaming, and forced Neteller from the market. The DOJ told Google and Yahoo to stop taking paid ads. Although very few people have been prosecuted, the fear that they might be breaking the law has prevented large non-gaming companies from getting into the business, and scared off Nevada licensed operators.
The entire industry has been hurt by the clouds of legal uncertainty. Even though I have found only one person in the history of North America who was ever charged with making a bet online, players are scared. I get more questions about whether it is legal to bet online than on any other subject.
The DOJ and UIGEA can actually be seen as anti-consumer protection, because the large, publicly traded companies now won't take bets from Americans.
Some of my clients, privately owned, are still taking bets from the U.S. and are honest and competent. But the exit of sites like PartyPoker has created openings and opportunities for unscrupulous operators.
CAPPERSMALL.COM: With the attention received by Rep. Barney Frank's introduction of his Internet Gambling Regulation and Enforcement Act and more recently, Rep. Jim McDermott's letter to congress asking for support of that bill, it is beginning to look like a larger segment of those that make our laws have become more willing to have an open mind on the internet gambling issue. Those that are responsible for running the U.S. based brick and mortar casinos also seem to have had a change of heart regarding the regulation of internet gambling as they see all too clearly that literally billions of dollars are being sent abroad by U.S. bettors each year.
The issue has always been tied to the morality aspect of the debate but it appears that the American public is becoming more accepting of gambling, particularly with the rapid proliferation of the advantages that the internet offers.
Do you foresee a change philosophy in which U.S. Lawmakers will come to appreciate the tremendous tax revenue that could be realized by legalizing and regulating the industry in the U.S. and ?
PROFESSOR ROSE:
Nothing is going to happen this year. It's an election year, so the Republicans are pandering to the religious far right. They don't have that much trouble with gambling in other years; Trent Lott, then-majority leader of the Senate, was from Mississippi, the third-largest casino state. But, Republicans don't have any interest in internet gaming. Also, Pres. Bush would never sign a law allowing internet gaming.
Politics will play a role. When the Democrats took control of the Senate, Harry Reid, senator from Nevada, became majority leader. So, land-based casinos, which want a study and law allowing them to operate internet casinos, can get those, if the President is a Democrat. If John McCain wins, Republicans will take over the Senate, so nothing will change. Insiders know that if Hillary Clinton is the nominee, Democrats will lose the Senate, even if she wins the presidency. There will then be four years of deadlock.
Assuming Barack Obama is nominated and wins, the Democrats will keep control of Congress and there will be a change in the federal law. It might come as early as 2009. More likely, it won't be until 2010, or even later. For political cover, there could be an objective, scientific study done first, that proves that internet gambling can be kept safe from hackers, protecting the "vulnerables" (children and compulsive gamblers), and that states that don't want to allow can be blocked.
I expect the federal law will eventually be changed to allow a state to opt-in, exactly the system that exists for horseracing today. In December 2000, Congress amended the Interstate Horseracing Act to allow people to bet by phone and computer from their homes, so long as they were in as state where it was legal and the bet went to a state where accepting such bets was legal. The system is called Advanced Deposit Wagering, and at least 20 states have opted in. It make no sense for Congress to say that states are competent to decide for themselves whether their residents can bets from their homes on horse races, but not on dog races. And if the states of California, Nevada, New Jersey and - to get rid of a problem with the World Trade Organization, other countries, like Antigua - want to allow their licensed poker operators to have games online, where their residents can play for money, why should the federal government care?
This does not mean that things will be wide open. There will never be much online sports betting outside of Nevada and with the state lotteries in Oregon and Delaware, unless federal law is ruled unconstitutional. And states like Utah will be able to keep all gambling illegal.
The interesting political factor is that very few people care about Internet gambling, especially in Congress. The Poker Players Association and the few members of Congress who have sponsored bills to change the law or at least conduct studies have done a great service in bringing the issue to the attention of politicians and the American people. But still it is such a low priority that it is just easier for lawmakers to let things continue as they are. The tax revenue issue is a non-starter. The federal government has now spent nearly a trillion dollars on the Iraq war. They really don't care about a few hundred million dollars from taxing online gambling, especially if they think voters see it as immoral or dangerous.
https://www.cappersmall.com/betting/articles/Online-Gambling-Interview-Professor-I-Nelson-Rose-6988.html
CAPPERSMALL.COM: The passage of the Unlawful Internet Gambling Enforcement Act in October of 2006 certainly had a significant effect on how offshore wagering portals facilitate financial transactions to and from their customers. What are some of the other ways in which the Act has changed online gambling?
PROFESSOR ROSE:
There have actually been two separate legal developments. The UIGEA obviously scared the publicly traded online gaming companies to stop taking bets from the U.S. But both before and after the passage of that Act, there has been a war of intimidation being waged by the U.S. Department of Justice against all internet gambling. It was the DOJ, not the Act, that scared credit card companies into blocking use of their cards for gaming, and forced Neteller from the market. The DOJ told Google and Yahoo to stop taking paid ads. Although very few people have been prosecuted, the fear that they might be breaking the law has prevented large non-gaming companies from getting into the business, and scared off Nevada licensed operators.
The entire industry has been hurt by the clouds of legal uncertainty. Even though I have found only one person in the history of North America who was ever charged with making a bet online, players are scared. I get more questions about whether it is legal to bet online than on any other subject.
The DOJ and UIGEA can actually be seen as anti-consumer protection, because the large, publicly traded companies now won't take bets from Americans.
Some of my clients, privately owned, are still taking bets from the U.S. and are honest and competent. But the exit of sites like PartyPoker has created openings and opportunities for unscrupulous operators.
CAPPERSMALL.COM: With the attention received by Rep. Barney Frank's introduction of his Internet Gambling Regulation and Enforcement Act and more recently, Rep. Jim McDermott's letter to congress asking for support of that bill, it is beginning to look like a larger segment of those that make our laws have become more willing to have an open mind on the internet gambling issue. Those that are responsible for running the U.S. based brick and mortar casinos also seem to have had a change of heart regarding the regulation of internet gambling as they see all too clearly that literally billions of dollars are being sent abroad by U.S. bettors each year.
The issue has always been tied to the morality aspect of the debate but it appears that the American public is becoming more accepting of gambling, particularly with the rapid proliferation of the advantages that the internet offers.
Do you foresee a change philosophy in which U.S. Lawmakers will come to appreciate the tremendous tax revenue that could be realized by legalizing and regulating the industry in the U.S. and ?
PROFESSOR ROSE:
Nothing is going to happen this year. It's an election year, so the Republicans are pandering to the religious far right. They don't have that much trouble with gambling in other years; Trent Lott, then-majority leader of the Senate, was from Mississippi, the third-largest casino state. But, Republicans don't have any interest in internet gaming. Also, Pres. Bush would never sign a law allowing internet gaming.
Politics will play a role. When the Democrats took control of the Senate, Harry Reid, senator from Nevada, became majority leader. So, land-based casinos, which want a study and law allowing them to operate internet casinos, can get those, if the President is a Democrat. If John McCain wins, Republicans will take over the Senate, so nothing will change. Insiders know that if Hillary Clinton is the nominee, Democrats will lose the Senate, even if she wins the presidency. There will then be four years of deadlock.
Assuming Barack Obama is nominated and wins, the Democrats will keep control of Congress and there will be a change in the federal law. It might come as early as 2009. More likely, it won't be until 2010, or even later. For political cover, there could be an objective, scientific study done first, that proves that internet gambling can be kept safe from hackers, protecting the "vulnerables" (children and compulsive gamblers), and that states that don't want to allow can be blocked.
I expect the federal law will eventually be changed to allow a state to opt-in, exactly the system that exists for horseracing today. In December 2000, Congress amended the Interstate Horseracing Act to allow people to bet by phone and computer from their homes, so long as they were in as state where it was legal and the bet went to a state where accepting such bets was legal. The system is called Advanced Deposit Wagering, and at least 20 states have opted in. It make no sense for Congress to say that states are competent to decide for themselves whether their residents can bets from their homes on horse races, but not on dog races. And if the states of California, Nevada, New Jersey and - to get rid of a problem with the World Trade Organization, other countries, like Antigua - want to allow their licensed poker operators to have games online, where their residents can play for money, why should the federal government care?
This does not mean that things will be wide open. There will never be much online sports betting outside of Nevada and with the state lotteries in Oregon and Delaware, unless federal law is ruled unconstitutional. And states like Utah will be able to keep all gambling illegal.
The interesting political factor is that very few people care about Internet gambling, especially in Congress. The Poker Players Association and the few members of Congress who have sponsored bills to change the law or at least conduct studies have done a great service in bringing the issue to the attention of politicians and the American people. But still it is such a low priority that it is just easier for lawmakers to let things continue as they are. The tax revenue issue is a non-starter. The federal government has now spent nearly a trillion dollars on the Iraq war. They really don't care about a few hundred million dollars from taxing online gambling, especially if they think voters see it as immoral or dangerous.
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